Wednesday, June 7, 2017

Shave the Billionaire or Life Has Its Ups and Downs

From The Baffler:

Strange things are happening in Brazil:
billionaires are going to jail. This includes Eike Batista, once the
eighth-richest person in the world, who was arrested in January. Accused
of paying $16.5 million in bribes, he was placed in a 160-square-foot
cell with six other prisoners who shared a single fan and a single squat
toilet and a single tap where the water turned on just a few times a
day. His head was shaved—a standard procedure in Rio de Janeiro’s prison
system, but one that came as a shock to those who remembered how he had
once bragged on TV about his $30,000 wig. People used to call Eike the Donald Trump of Brazil. He kept a silver SLR McLaren in his living room.

In the past couple of years, two other Brazilians from the Forbes
list have ended up behind bars: the construction tycoon Marcelo
Odebrecht (convicted of corruption) and the investment banker André
Esteves (still awaiting trial). Along with dozens of other executives,
lobbyists, and politicians, they were ensnared in a federal police
investigation known as Operation Car Wash, which has exposed a
multibillion-dollar kickback scheme that doubled as a kind of parallel
campaign-finance system. Even the patrician president, Michel Temer, has
been implicated. This is a big deal given that, for most of Brazil’s
history, the rich routinely bought or bullied judges and only the poor
faced the full extent of the law. The crimes uncovered, though, are not
unique to Brazil. The fall of Eike Batista is actually a story about the
ethics of the business class, whatever its nationality.

First you should know how Eike came about his wealth. In a country that runs on crony capitalism,
he pitched himself as a new kind of businessman: a risk-taking
entrepreneur making his fortune on good ideas, not through government
connections—though he is the son of a former minister of mines and
energy. Promising to create some of the world’s largest companies from
scratch, he sold a series of startups to money managers made thirsty by
the Brazilian natural-resources boom. By 2012, just six years after his
first IPO, he was worth $34 billion. Already the country’s richest
person, he claimed he would soon be the world’s richest person. The
problem was that he didn’t have the resources he claimed. And worse: he
owed untold billions to banks and bondholders. When it became clear that
his business plans amounted to little more than wishful thinking, the
investor class abandoned him. By 2014 he was bankrupt....MORE

Medieval Europeans were firm believers in the Wheel of Fortune:

Detail of a miniature of the Wheel of Fortune with a crowned king at the top, from John Lydgate's Troy Book and Siege of Thebes,

with verses by William Cornish, John Skelton, William Peeris and others, England, c. 1457 (with later additions), Royal 18D. ii, f. 30v.